Correlation Between IShares SPTSX and Hamilton Mid
Can any of the company-specific risk be diversified away by investing in both IShares SPTSX and Hamilton Mid at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining IShares SPTSX and Hamilton Mid into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares SPTSX Global and Hamilton Mid Cap Financials, you can compare the effects of market volatilities on IShares SPTSX and Hamilton Mid and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in IShares SPTSX with a short position of Hamilton Mid. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares SPTSX and Hamilton Mid.
Diversification Opportunities for IShares SPTSX and Hamilton Mid
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between IShares and Hamilton is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding iShares SPTSX Global and Hamilton Mid Cap Financials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hamilton Mid Cap and IShares SPTSX is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on iShares SPTSX Global are associated (or correlated) with Hamilton Mid. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hamilton Mid Cap has no effect on the direction of IShares SPTSX i.e., IShares SPTSX and Hamilton Mid go up and down completely randomly.
Pair Corralation between IShares SPTSX and Hamilton Mid
Assuming the 90 days trading horizon IShares SPTSX is expected to generate 1.11 times less return on investment than Hamilton Mid. In addition to that, IShares SPTSX is 1.09 times more volatile than Hamilton Mid Cap Financials. It trades about 0.1 of its total potential returns per unit of risk. Hamilton Mid Cap Financials is currently generating about 0.12 per unit of volatility. If you would invest 2,771 in Hamilton Mid Cap Financials on December 4, 2024 and sell it today you would earn a total of 871.00 from holding Hamilton Mid Cap Financials or generate 31.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 63.82% |
| Values | Daily Returns |
iShares SPTSX Global vs. Hamilton Mid Cap Financials
Performance |
| Timeline |
| iShares SPTSX Global |
| Hamilton Mid Cap |
IShares SPTSX and Hamilton Mid Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares SPTSX and Hamilton Mid
The main advantage of trading using opposite IShares SPTSX and Hamilton Mid positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares SPTSX position performs unexpectedly, Hamilton Mid can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Hamilton Mid will offset losses from the drop in Hamilton Mid's long position.| IShares SPTSX vs. iShares SPTSX Capped | IShares SPTSX vs. iShares SPTSX Capped | IShares SPTSX vs. iShares SPTSX Capped | IShares SPTSX vs. iShares SPTSX Capped |
| Hamilton Mid vs. CI Canadian Banks | Hamilton Mid vs. BMO Mid Term IG | Hamilton Mid vs. Celestica | Hamilton Mid vs. Descartes Systems Group |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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